Mar 16, 2020 13:02 UTC
Mar 16, 2020 at 13:08 UTC
5 Tips on Avoiding Scam AI Trading Sites
On the one hand, there can be no denying that artificial intelligence (AI) will play a dominant role in the future of online trading. In fact, banks, financial institutions and leading hedge funds have been utilizing the technology for a number of decades.
However, the retail space is only just gaining access to the fruits of AI trading software, so consumer choice is still somewhat limited. With that said, there are a number of platforms active in the online trading arena that now offer fully-fledged AI bots.
Simply sign up, deposit funds, and allow the bot to buy and sell assets on your behalf. If only it was that easy.
As explained by UK-based forex signal provider Learn 2 Trade, the AI trading sphere is unfortunately home to a number of scam platforms. Such platforms make countless promises of ‘guaranteed’ profits of 90% plus – all in return for a huge one-off payment.
As we now know, most – but not all, of these providers are nothing more than a scam. To ensure you avoid joining an illegitimate AI platform, Learn 2 Trade provides 5 handy tips to consider prior to parting with your money.
- What is the Background of the AI Trading Provider?
Without a doubt, your first port of call should be to explore the merits of the company behind the AI trading platform. Learn 2 Trade explains that retail clients should perform enhanced due diligence on the provider, which should include metrics such as the company’s location, and when they were first launched.
The internet is jam-packed with information in this respect, so you should be able to find the required data quickly. Crucially, if you are unable to locate the AI trading platform’s registered address, owner, or foundation date – this should act as a major red flag. Typically, such platforms will hide this information because they want to operate in an anonymous manner.
- What Service Does the AI Trading Platform Offer?
The term ‘AI Trading Platform’ is somewhat of a broad one, not least because it can refer to a range of different services. For example, some AI trading sites will offer an all-in, fully automated service. This means that once you pay a subscription fee, the automated technology will perform on your behalf. In this sense, you won’t need any knowledge of buying and selling assets, as the AI bot will do this autonomously,
At the other end of the spectrum, some AI trading sites merely provide the required research for you to then trade yourself. For example, you might receive a forex trading signal with the relevant entry and exit points, and you’d then need to place the respective buy/sell orders.
- How Much Does the AI Trading Platform Cost?
You also need to make some considerations regarding costs. Learn 2 Trade explains that retail clients need to find the perfect balance between pricing and effectiveness. This is no easy feat, as it’s often difficult to gauge how successful the AI trading bot is until it goes live.
At the lower end, you should avoid using free AI trading platforms, not least because the effectiveness of the technology is likely to be extremely limited. At the higher end, you don’t want to be paying an arm and a leg for software when you are yet to ascertain its effectiveness.
- Avoid One-Off Fee Providers
Leading on from the above section of pricing, Learn 2 Trade explains that traders should avoid AI platforms that charge a one-off fee. This is a tactic often employed by scam AI trading websites, as once your money has been collected, you’re essentially left in limbo. Instead, it’s best to stick with AI trading platforms that offer a competitive monthly subscription service.
In doing so, you can cancel your membership at any given time, based on the results of the AI bot. This also motivates the AI bot provider to tweak and improve the software on a consistent basis. It is also a wise idea to stick with AI trading platforms that offer a free trial of some sort. This will allow you to test the software out before making a financial commitment.
- Stick With AI Trading Platforms That Come With In-House Testing Facilities
Investors also need to ensure that they only use AI trading platforms that offer in-house testing facilities. Learn to Trade explains that this allows you to test-drive your software before going live. For example, let’s say that you have built an AI bot to mirror your proven trading strategy – which focuses on GBP/USD.
Although you might have had success with your strategy when trading manually, there might be a slight error or bug in the AI algorithm that needs tweaking. Making such a discovery when the bot is already trading with real-world money could be disastrous, which is why you should stick with platforms that allow you to test the software first. In doing so, you can make changes on a trial and error basis, until the AI bot is ready to be released into live trading conditions.
This is a paid press release. Btcwires does not endorse and is not responsible for or liable for any content, accuracy, quality, advertising, products or other materials on this page. Readers should do their own research before taking any actions related to the company.